Costa Rica May
Tax Online
Gambling to Fund
Crime Fighting
Gamingzion.com
Many of the
world’s largest
online gambling
sites are
operated out of
Costa Rica.
There are two
simple reasons
for this. First,
the country has
no specific laws
regarding online
gambling
licensing,
meaning that
corporations,
even foreign
groups, can
operate internet
gambling sites
under a very
generic "data
processing
license".
Second, Costa
Rica is listed
as a “tax
haven”.
Foreign-source
income is not
taxed locally,
giving
international
online gambling
service
providers a very
strong financial
incentive to
base their
operations in
the country.
This may not be
the case for
long. Costa
Rica’s new
president Laura
Chinchilla, who
was sworn into
office on May
8th, has already
mentioned plans
to change Costa
Rican Gambling
Laws.
Specifically,
the new
president wants
to tax online
gambling. The
motivation
behind this move
is unabashedly
financial. Costa
Rica takes only
14.8% of local
income as tax,
which is not
enough to fund
the big crime
fighting changes
that Chinchilla
wants to put
into place.
By imposing
taxes on casinos
and online
gambling sites
in Costa Rica,
Chinchilla hopes
to bring in an
additional 1% of
the country’s
GDP. This
increase in
annual state
income would be
a quick and easy
way for the new
presidenta to
fund her battle
against drug
trafficking and
local crime.
Most of internet
gambling sites
that operate out
of Costa Rica
target players
on that site of
the world,
especially in
North America.
Both the US and
Canada are
currently
working out
provisions which
could see local
online gambling
offerings. If
this happens, it
could deliver a
fatal blow to
Costa Rica’s
hold on the
industry,
especially if
the current tax
incentives go
away. While
Chinchilla
probably
understands that
taxing online
gambling is only
a quick fix,
changes in the
approach taken
by Costa Rica’s
northerly
neighbors may
cut her plan
short sooner
than she thinks.
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